A logistics firm that won over £1 billion ($1.3 billion) worth of U.K. government contracts during the pandemic is embroiled in a trial over whether it was justified in breaking off a contract with a supplier during the race to source medical equipment during the first wave of COVID-19.
Logistics provider Uniserve Ltd., the company owned by businessman Iain Liddell, walked away from a deal in June 2020 with a Jordanian supplier to buy 80 million face masks, after finding a cheaper Chinese supplier in June 2020, lawyers for Hitex, the Jordanian firm, told the U.K. High Court on May 16. Hitex is seeking $23 million in compensation from Uniserve.
Uniserve denied the claim and alleged Hitex overstated their production capacity and delayed delivery of the masks. “I can’t put my name to this, and they can’t produce so we have to cancel,” Liddell was quoted as saying in court documents.
The government, desperate for medical equipment at the start of the pandemic, handed contracts to firms with little experience in manufacturing or procuring them, which then rushed to meet the large demands. Almost 400 contracts worth £7.9 billion were handed to ‘VIP lane suppliers’ including Uniserve, according to U.K.’s National Audit Office.
Uniserve’s £70-million contract to supply 80 million face masks to the health department was part of over £1 billion worth of contracts it won. The company was referred by Theodore Agnew, then a minister of state at the cabinet office and the Treasury.
“Uniserve denies any liability,” its lawyers said. Uniserve terminated the contract in June 2020, after Hitex failed to meet the delivery schedule for the masks, they said.
The Upminster, Essex-based shipping firm launched a counter claim and alleged it was induced to sign the contract based on deceit and misrepresentation about production capacity of Hitex.
